Want to boost your performance? Make sure you look after your people

Retention and company culture are no longer the concern of the HR department alone, says People 1st’s Martin-Christian Kent

The UK’s hospitality and tourism sector is facing a perfect storm of rising costs, increasing recruitment difficulties and changing employee attitudes. Compounding this is the political and economic uncertainty around Brexit.

To get a better understanding of how all of this is playing out when it comes to the important issue of productivity, we recently spoke to 40 large employers in the sector, including the likes of Casual Dining Group, Compass Group UK & Ireland, Drake & Morgan, Enterprise Inns, Jamie Oliver Ltd, Sodexo and the Restaurant Group. From what they told us, there is a clear rupture with the way businesses have operated in the past in order to deal with this challenging environment.

In particular, things that were traditionally seen as ‘HR issues’, such as retention, performance management and learning and development, are now viewed as business-critical. The reason for this change is simple. Boosting productivity is vital if firms are going to offset costs and maximise customer experience and profitability.

That’s why two-thirds of the employers we spoke to are actively exploring how to improve productivity.

A key aspect of this is addressing staff retention. The sector can no longer afford its high levels of staff turnover – averaging 75% compared with the UK average of some 15% – and so for the majority of employers, tackling this has become a real business priority. It’s also clear that employers are more aware than ever of the direct correlation between people, performance and the bottom line.

Businesses are trying to recruit staff who are more likely to stay with them, which means being more selective about who and how they recruit. Additionally, they are investing more in people, from improved induction programmes to greater investment in career progression support and training and development.

One of the more interesting findings is the degree to which employers now understand that younger staff are motivated by different factors and need to be engaged and managed differently. In particular, they are far less accepting of poor working conditions or long hours.

Poor management skills is another factor identified by many businesses as increasing staff turnover and damaging productivity.

It was acknowledged that some managers are over-promoted or promoted too quickly and lack the skills required to do their jobs effectively. Equally, high managerial turnover causes its own instability and has a knock-on effect across the business.

Businesses are also beginning to explore how organisational design can improve
productivity. Some are rethinking the customer journey and are introducing new technology as part of this. Others are refining the way staff work or introducing technology to help them undertake specific tasks more effectively.

Overall, it was striking that there is a great disparity between where employers are on this journey. While there are great examples of organisations that are ahead of the curve, some companies are only at the beginning of their journey.